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PURPOSE:
To provide an update and reminder to Local Public Agencies (LPAs) and ODOT staff who provide support to LPAs about the following:
- Indirect Cost Allocation Plan approval requirements
- Approved plans and rates expire June 30 of each year
- Contact information for ODOT Financial Services
BULLETIN INFORMATION:
1. Billing Indirect Costs: As outlined in Section C, Chapter 5 of the Local Agency Guidelines for Certified Local Public Agencies and as specified in our LPA project agreements, if an LPA intends to bill indirect costs to a project, the LPA must have an approved Indirect Cost Allocation Plan (ICAP) and current approved Indirect Rate(s) in place prior to performing the work. Without an approved ICAP and current approved rate(s), the LPA may only bill for direct costs.
2. Approval Requirements: The ICAP must comply with the federal cost accounting principles established under 2 CFR Part 200, referred to as OMB Supercircular. Per federal guidance, ICAP rates must be reviewed and approval annually.
a. When and where to submit: Approvals with ODOT expire June 30 of each year. To ensure there is no lapse in their approved rate(s), LPAs should submit their ICAP and Indirect Rate(s) to ODOT Financial Services for review and approval several weeks prior to the expiration date. (See 4. below for contact details.)
b. What to submit: An ICAP and Indirect Rate(s) can be approved either by the LPA’s federal cognizant agency (as defined by 2 CFR Part 200) or through ODOT Financial Services. In either case, ODOT needs to review and determine whether the rates are appropriate for use in our LPA project agreements.
i. For LPAs that have previously approved ICAP and Indirect Rate(s) on file with ODOT, submit an updated plan and rates for review to ODOT Financial Services.
ii. For LPAs that have an approved ICAP and Indirect Rate(s) with a federal cognizant agency, submit a copy of the cognizant agency’s current approval letter for review. ODOT Financial Services may request additional information.
iii. For LPAs that have never received ICAP and Indirect Rate approval or approval to use the 10% de minimis rate, contact your ODOT local agency liaison or funding program manager who will work with you and ODOT Financial Services to discuss options.
3. Agreement Language:
Language substantially similar to the following will be included in LPA project agreements:
Indirect Cost Rate:
a) Agency shall invoice ODOT using the current, approved indirect cost rate on file with ODOT.
b) As required by 2 CFR 200.331(a)(4), the indirect cost rate(s) for this project at the time the agreement is written is [(select approved option) ___ % / the ten percent (10%) de minimus rate per 2 CFR 200.414 / zero percent (0%)]. This rate may change during the term of this Agreement upon notice to ODOT and ODOT’s subsequent written approval.
c) If the approved rate(s) change(s) during the term of this Agreement, Agency shall invoice ODOT using the current indirect cost rate(s) for the Project on file with ODOT at the time the work is performed. If Certified Agency does not have (an) approved indirect cost rate(s) on file with ODOT at the time the work is performed, Agency shall invoice ODOT using a zero percent (0%) rate.
4. Technical Assistance: ODOT Financial Services maintains an internal listing of approved Local Government ICAP and Indirect Cost Rates. An LPA that is unsure about the approval status of their ICAP and Indirect Cost Rate(s) should contact the responsible ODOT local agency liaison or funding program manager for information and to establish initial communication with ODOT Financial Services.
Debra Burger, Fiscal Analyst
ODOT Financial Services
Debra.A.BURGER@odot.oregon.gov
503-986-3916
Questions or concerns? Please contact us at:
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